Danny DeMichele

Hobbies: Surfing, Stand-up paddle boarding, hanging with his wife and three kids

Current book: The E Myth, “for the sixth time”

Favorite gadget: iPhone, iPad

Tip: “Don’t count Facebook out. It’s a company that has the most engagement of anything ever in the history of the universe. They’re going to figure out mobile, they’re going to figure out micro-transaction and their revenue model. They’re going to prove their worth.”

When Danny DeMichele was searching for funding last decade, the San Diego entrepreneur pretty much gave up.

“I’ve always had a very difficult time raising money here and finding management support. I was often overlooked for competitors who I felt weren’t quite as strong, but they happened to be in the Bay Area (near venture capital),” said DeMichele, the Coronado native who sold his last venture, eVisibility, an Internet marketing agency, for $5 million two years ago.

Even before leaving, DeMichele dreamed of what he would do next:

Incubate.com. The goal? Help San Diego businesses with financing, structure, management and marketing to keep them in the neighborhood.

Incubate.com launched quietly in Carlsbad last October and currently invests in 10 companies — all in San Diego. Most were struggling, underfunded businesses. Some are ideas with a long way to go. On its site,

Incubate.com encourages queries because it takes “5 minutes to decide” whether to move forward. They get about 30 a week, and DeMichele welcomes them all. “We want to continue to expand. Our goal is to have 50 businesses in our portfolio in the next three years,” he said.

DeMichele, who’s home by 5 p.m. daily to spend time with his wife and three children, answered the U-T’s questions about what Incubate has gotten itself into.

Q: Why Incubate. com?

A: When I sold my most recent company, I decided to start Incubate to help form and finance San Diego businesses so they don’t leave for the Bay Area. I want to find new businesses, tech businesses in San Diego and find local investors.

Q: Do you invest only in San Diego companies?

A: We’re not exclusive, but right now, we’ve only funded San Diego companies. The only other reason we would invest in a company outside of the area is to get them to move down here.

Q: How does this work at Incubate.com?

A: We do a round-table once a month. Usually, it’s a core group of seven of us. Sometimes we’ll bring in an investor. We have a very tight network of investors who will offer us money for particular deals. A couple of our members are part of Angel investor groups. Usually they (Angel investors) look at bigger deals. We want to use them as a source. Our deals typically take a few days. Most of the time, you’re looking for funding, you’re looking at a 6-to-9-month process. Ours is 30 to 60 days.

Q: What do you look for?

A: The one thing we look for is a business model. A lot of companies start with ideas without a business model. Is there an established revenue model? Whether they are making revenue doesn’t make a difference. We also want to look for a team that is dedicated. The other thing we look for is if we have the expertise within that niche to help. I’m not going to invest in a tractor-trailer company because I have no experience in that model.